OIL
Let’s start today’s analysis with the oil market, which experienced a big move recently. The price of oil moved above the July peaks and reached the year-to-date highs.However, the upward move was stopped just before the $80 per barrel mark. Looking at the H4 interval, we can see that the downward correction reached a key support, where the buyers appeared. The green marked zone ($77.15-$77.70) is a result of the previous local high and the lower limit of the 1:1 structure. According to the Overbalance methodology, bouncing off this hurdle may herald the continuation of the upward trend.
OIL H4 interval. Source: xStation5
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Let’s move to the US tech index chart - Nasdaq (US100). Looking at the D1 interval, one can see that the upward move was halted and the downward correction started. The downward move reached the key short term support which is a result of 100-period moving average, as well as neckline of the head and shoulders formation (which often heralds a trend reversal). Should sellers manage to break below, a bigger sell-off may happen. Considering such a scenario, the next key support to watch lies at 13,950 pts (previous price reactions and lower limit of 1:1 structure). On the other hand, if buyers manage to halt declines on the aforementioned moving average, another upward impulse may be generated.
US100 D1 interval. Source: xStation5
DE30
Last but not least, let’s take a look at the German index - DAX (DE30). Looking at the D1 interval, one can see that the upward trend has been halted. DE30 did not manage to stay above the 15,570 pts handle and the downward correction started. The index is currently trading below the 100-period moving average which may encourage market bears to be more active. Should current negative sentiment prevail in the near term, the downward correction may deepen. In such a scenario, the 15,050 pts area is the first key support to watch. It should also be noted that the current correction is very small compared to the entire upward movement started in November last year. Even a drop to the 38.2% Fibonacci retracement at 14,220 pts should not threaten the uptrend.
DE30 D1 interval. Source: xStation5
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